Legal Question in Intellectual Property in Utah

Developed software code, not yet compensated - can I take the code and leave?

I am in a verbal-only partnership at this time with a partner. I have developed an online-software application which is near completion. We don't yet have any signed contracts stating that we have a partnership, that I am an owner, or anything of that nature. I am the minority partner, and the majority partner does not want to budge on a contract change that I feel should be there. He does not want to add a clause stating that I cannot be let go from the corporation without compensation, which I feel is fair, considering my involvement in this business. He would legally be allowed to let me go at any point, for any reason. All residual profits I am getting will cease, and no further compensation will be given.

I have solely developed the software code. If he is unwilling to enter this clause into the contract, do I have the legal ability to take the software code and leave, maintaining owner of the code? I have not been compensated for the code yet in any way. We verbally agreed in the beginning that I would be compensated 10% ownership in the company in return to develop the code. That has not yet happened. What legal standing do I have in leaving with the code in my ownership?


Asked on 10/09/06, 1:26 am

2 Answers from Attorneys
Alvin Lundgren Alvin R. Lundgren, L.C.

Re: Developed software code, not yet compensated - can I take the code and leave?

You are guaranteed to have a problem in the future unless you get a written agreement. If you have not yet been compensated about all you have is an agreement to become a partnership. In order for an oral agreement to be binding there has to be witnesses which can testify that they witnessed enough of the terms to prove there was a partnership, which include most of the major terms of a written contract, i.e. parties, term of the partnership, work to be performed, division of profits and partnership ratio. You should talk to an attorney.

Read more
Answered on 10/09/06, 11:08 am
Lawrence Graves Coolidge & Graves PLLC

Re: Developed software code, not yet compensated - can I take the code and leave?

You may actually be sitting in a pretty good place. What the "majority partner" likely doesn't understand is that, until you sign something (which I am assuming you have not), you own the copyright in the software. This "partnership" may not even exist. SO, take heart and consult with an attorney who has expertise in copyright as well as partnership issues.

Best wishes,

LDWG

Read more
Answered on 10/09/06, 3:07 pm


Related Questions & Answers

More Intellectual Property questions and answers in Utah